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MNCs’ HRM Strategy and Country of Origin Effect: Do North American, European and Japanese Firms Really Differ?

  • Gyu-Chang Yu


    (Hanyang University, School of Business)

  • Woo-Sung Park

    (Kyunghee University)

  • Yung-Ho Cho

    (Ajou University)

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    Based upon the sample of 419 MNCs’ subsidiaries in Korea, we examined the country of origin effect in the choice of MNCs’ HRM strategy: transplantation, localization, and mixed. A multinominal logit regression analysis showed that there is an important country of origin effect in the choice between a localization strategy and a mixed strategy. North American MNCS tended to implement mixed strategy, while Japanese MNCs tended to adopt localization strategy. European MNCs were in the middle. The estimated log odds of choosing a localization strategy over a mixed strategy by Japanese subsidiaries were 1.79 times higher than European subsidiaries and 2.85 times higher than N. American subsidiaries; those by European subsidiaries were 1.59 times higher than N. American subsidiaries. However, the country of origin was not significantly related to the choice between a transplantation strategy and other strategies. We also examined two alternative factors influencing the HRM strategy of foreign subsidiaries: investment strategy and entry strategy. The implications of this and directions for future research are discussed.

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    Article provided by Rainer Hampp Verlag in its journal Management Revue - The international Review of Management Studies.

    Volume (Year): 18 (2007)
    Issue (Month): 4 ()
    Pages: 392-409

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    Handle: RePEc:rai:mamere:doi_10.1688/1861-9908_mrev_2007_04_yu
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